EXHIBIT 5
PAX WORLD FUND, INCORPORATED
c/o Pax World Management Corp.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
July 1, 1998
X.X. Xxxxxxxxxx & Co., Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Ladies and Gentlemen:
We hereby confirm our agreement with you as follows:
1. In consideration of the agreements on your part herein contained and
of the payment by us to you of a fee of $1 per year and on the terms and
conditions set forth herein we have agreed that you shall be, for the period of
this agreement, a distributor, as our agent, for the unsold portion of such
number of shares of the Common Stock of Pax World Fund, Incorporated (the
"Common Stock") as may be effectively registered from time to time under the
Securities Act of 1933, as amended (the "1933 Act"). This agreement is being
entered into pursuant to the Distribution and Service Plan (the "Plan") adopted
by us in accordance with Rule 12b-1 under the Investment Company Act of 1940, as
amended (the "1940 Act").
2. We hereby agree that you will act as our agent, and hereby appoint
you our agent, to distribute, offer, and to solicit offers to subscribe to, the
unsold balance of shares of our Common Stock as shall then be effectively
registered under the 1933 Act. All subscriptions for shares of our Common Stock
obtained by you shall be directed to us for acceptance and shall not be binding
on us until accepted by us. You shall have no authority to make binding
subscriptions on our behalf. We reserve the right to sell shares of our Common
Stock through other distributors or directly to investors through subscriptions
received by us at our principal office in Portsmouth, New Hampshire. The right
given to you under this agreement shall not apply to shares of our Common Stock
issued in connection with (a) the merger or consolidation of any other
investment company with us, (b) our acquisition by purchase or otherwise of all
or substantially all of the assets or stock of any other investment company, or
(c) the reinvestment in shares of our Common Stock by our shareholders of
dividends or other distributions or any other offering by us of securities to
our shareholders.
3. You will use your best efforts to obtain subscriptions to shares of
our Common Stock upon the terms and conditions contained herein and in our
Prospectus and Statement of Additional Information, as in effect from time to
time. You will send to us promptly all subscriptions placed with you. We shall
furnish you from time to time, for use in connection with the offering of shares
of our Common Stock, such other information with respect to us and shares of our
Common Stock as you may reasonably request. We shall supply you with such copies
of our Registration Statement, Prospectus and Statement of Additional
Information, as in effect from time to time, as you may request. Except as we
may authorize in writing, you are not authorized to give any information or to
make any representation that is not contained in the Registration Statement,
Prospectus or Statement of Additional Information, as then in effect. You may
use employees, agents and other persons, at your cost and expense, to assist you
in carrying out your obligations hereunder, but no such employee, agent or other
person shall be deemed to be our agent or have any rights under this agreement.
You may sell our shares to or through qualified brokers, dealers and financial
institutions under selling and servicing agreements provided that no dealer,
financial institution or other person shall be appointed or authorized to act as
our agent without our written consent.
4. All sales of our shares effected through you will be made in
compliance with all applicable federal securities laws and regulations and the
Constitution, rules and regulations of the National Association of Securities
Dealers, Inc. ("NASD"). We reserve the right to suspend the offering of shares
of our Common Stock at any time, in the absolute discretion of our Board of
Directors, and upon notice of such suspension you shall cease to offer shares of
our Common Stocks hereunder.
5. Both of us will cooperate with each other in taking such action as
may be necessary to qualify shares of our Common Stock for sale under the
securities laws of such states as we may designate, provided, that you shall not
be required to register as a broker-dealer or file a consent to service of
process in any such state where you are not now so registered. We will pay all
fees and expenses of registering shares of our Common Stock under the 1933 Act
and of qualification of shares of our Common Stock, and to the extent necessary,
our qualification under applicable state securities laws. You will pay all
expenses relating to your broker-dealer qualification.
6. We represent to you that our Registration Statement, Prospectus and
Statement of Additional Information have been prepared in conformity with the
requirements of the 1933 Act and the 1940 Act and the rules and regulations of
the Securities and Exchange Commission (the "SEC") thereunder. We represent and
warrant to you, as of the date hereof, that our Registration Statement,
Prospectus and Statement of Additional Information contain all statements
required to be stated therein in accordance with the 1933 Act and the 1940 Act
and the SEC's rules and regulations thereunder; that all statements of fact
contained therein are or will be true and correct at the time indicated; and
that neither our Registration Statement, our Prospectus nor our Statement of
Additional Information, when they shall be authorized for use, will include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading to
a purchaser of shares of our Common Stock. We will from time to time file such
amendment or amendments to our Registration Statement, Prospectus and Statement
of Additional Information as shall, in the opinion of our counsel, be necessary.
We represent and warrant to you that any amendment to our Registration
Statement, Prospectus or Statement of Additional Information hereafter filed by
us will be prepared in conformity within the requirements of the 1933 Act and
the 1940 Act and the SEC's rules and regulations thereunder and will, when it
becomes effective, contain all statements required to be stated therein in
accordance with the 1933 Act and the 1940 Act and the SEC's rules and
regulations thereunder; that all statements of fact contained therein will, when
the same shall become effective, be true and correct; and that no such
amendment, when it becomes effective, will include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading to a purchaser of our
shares.
7. We agree to indemnify, defend and hold you, your officers and
directors, and any person who controls you within the meaning of Section 15 of
the 1933 Act, free and harmless from and against any and all claims, liabilities
and expenses (including the cost of investigating or defending such claims,
demands or liabilities and any counsel fees incurred in connection therewith)
which you or any such controlling person may incur, under the 1933 Act or the
1940 Act, or under common law or otherwise, arising out of or based upon any
alleged untrue statement of a material fact contained in our Registration
Statement, Prospectus or Statement of Additional Information in effect from time
to time or arising out of or based upon any alleged omission to state a material
fact required to be stated in either of them or necessary to make the statements
in either of them not misleading; provided, however, that in no event shall
anything herein contained be so construed as to protect you against any
liability to us or our security holders to which you would otherwise be subject
by reason of willful misfeasance, bad faith, or gross negligence in the
performance of your duties, or by reason of your reckless disregard of your
obligations and duties under this agreement. Our agreement to indemnify you and
any such controlling person is expressly conditioned upon our being notified of
any action brought against you or any such controlling person, such notification
to be given by letter or by telegram addressed to us at our principal office in
Portsmouth, New Hampshire, and sent to us by the person against whom such action
is brought within ten days after the summons or other first legal process shall
have been served. The failure so to notify us of any such action shall not
relieve us from any liability which we may have to the person against whom such
action is brought other than on account of our indemnity agreement contained in
this paragraph. We will be entitled to assume the defense of any suit brought to
enforce any such claim, and to retain counsel of good standing chosen by us and
approved by you. In the event we do elect to assume the defense of any such suit
and retain counsel of good standing approved by you, the defendant or defendants
in such suit shall bear the fees and expenses of any additional counsel retained
by any of them; but in case we do not elect to assume the defense of any such
suit, or in case you, in good faith, do not approve of counsel chosen by us, we
will reimburse you or the controlling person or persons named as defendant or
defendants in such suit, for the fees and expenses of any counsel retained by
you or them. Our indemnification agreement contained in this paragraph 7 and our
representations and warranties in this agreement shall remain in full force and
effect regardless
of any investigation made by or on behalf of you or any controlling person and
shall survive the sale of any shares of our Common Stock made pursuant to
subscriptions obtained by you. This agreement of indemnity will inure
exclusively to your benefit, to the benefit of your successors and assigns, and
to the benefit of any of your controlling persons and their successors and
assigns. We agree promptly to notify you of the commencement of any litigation
or proceeding against us in connection with the issue and sale of any shares of
our Common Stock.
8. You agree to indemnify, defend and hold us, our several officers and
directors, and any person who controls us within the meaning of Section 15 of
the 1933 Act, free and harmless from and against any and all claims, demands,
liabilities, and expenses (including the cost of investigating or defending such
claims, demands or liabilities and any reasonable counsel fees incurred in
connection therewith) which we, our officers or directors, or any such
controlling person may incur under the 1933 Act or under common law or
otherwise, but only to the extent that such liability or expense incurred by us,
our officers or directors or such controlling person shall arise out of or be
based upon any alleged untrue statement of a material fact contained in
information furnished in writing by you to us for use in our Registration
Statement, Prospectus or Statement of Additional Information as in effect from
time to time, or shall arise out of or be based upon any alleged omission to
state a material fact in connection with such information required to be stated
in the Registration Statement, Prospectus or Statement of Additional Information
or necessary to make such information not misleading. Your agreement to
indemnify us, our officers and directors, and any such controlling person is
expressly conditioned upon your being notified of any action brought against us,
our officers or directors or any such controlling person, such notification to
be given by letter or telegram addressed to you at your principal office in New
York, New York, and sent to you by the person against whom such action is
brought, within a reasonable time after the summons or other first legal process
shall have been served. You shall have a right to control the defense of such
action, with counsel of your own choosing, satisfactory to us, if such action is
based solely upon such alleged misstatement or omission on your part, and in any
other event you and we, our officers or directors or such controlling person
shall each have the right to participate in the defense or preparation of the
defense of any such action.
9. We agree to advise you immediately:
a. of any request by the SEC for amendments to our
Registration Statement, Prospectus or Statement of
Additional Information or for additional information,
b. of the issuance by the SEC of any stop order
suspending the effectiveness of our Registration
Statement, Prospectus or Statement of Additional
Information or the initiation of any proceedings for
that purpose, and
c. of the happening of any material event which makes
untrue any statement made in our Registration
Statement, Prospectus or Statement of Additional
Information or which requires the making of a change
in either of them in order to make the statements
therein not misleading.
10. This agreement will become effective on the date hereof and will
remain in effect thereafter for successive twelve-month periods (computed from
each July 1st), provided that such continuation is specifically approved at
least annually by vote of our Board of Directors and of a majority of those of
our directors who are not interested persons (as defined in the 0000 Xxx) and
have no direct or indirect financial interest in the operation of the Plan or in
any agreements related to the Plan, cast in person at a meeting called for the
purpose of voting on this agreement. This agreement may be terminated at any
time, without the payment of any penalty, (i) by vote of a majority of our
entire Board of Directors, and by a vote of a majority of our Directors who are
not interested persons (as defined in the 0000 Xxx) and who have no direct or
indirect financial interest in the operation of the Plan or in any agreement
related to the Plan, or (ii) by vote of a majority of our outstanding voting
securities, as defined in the Act, on sixty days' written notice to you, or
(iii) by you on sixty days' written notice to us.
11. This agreement shall be governed by and construed in accordance
with the laws of the State of New York.
12. This agreement may not be transferred, assigned, sold or in any
manner hypothecated or pledged by you and this agreement shall terminate
automatically in the event of any such transfer, assignment, sale,
hypothecation or pledge by you. The terms "transfer", "assignment" and "sale" as
used in this paragraph shall have the meanings ascribed thereto by governing law
and in applicable rules or regulations of the SEC thereunder.
13. Except to the extent necessary to perform your obligations
hereunder, nothing herein shall be deemed to limit or restrict your right, the
right of any of your employees who may also be a director, officer or employee
of ours, or of a person affiliated with us, as defined in the 1940 Act, to
engage in any other business or to devote time and attention to the management
or other aspects of any other business, whether of a similar or dissimilar
nature, or to render services of any kind to another corporation, firm,
individual or association.
14. This agreement has been prepared by the law firm of Xxxxxxx Xxxxxxx
& Xxxxxxxx, LLP, which has advised the both of us that there is an inherent
conflict of interest in their representation of the both of us. Because of this
conflict, we and our non-interested directors and you will not have the benefit
of independent counsel in the consideration of the fairness of this agreement.
This is to confirm that the both of us are aware of that conflict and that,
notwithstanding such conflict, the both of us have asked Xxxxxxx Xxxxxxx &
Xxxxxxxx, LLP to represent the both of us in this regard.
If the foregoing is in accordance with your understanding, will you
kindly so indicate by signing and returning to us the enclosed copy hereof.
Very truly yours,
PAX WORLD FUND, INCORPORATED
By:______________________________
Xxxxxxxx X. Xxxxxx
Chairman of the Board
Accepted and Agreed to as of the date hereof:
X.X. XXXXXXXXXX & CO., INC.
By:______________________________
Xxxxxx X. Xxxxx
President
